No principled PR pro could defend this performance

Eight days hence, the Minnesota chapter of the Public Relations Society of America (PRSA) will conduct an ethics seminar within walking distance of Home Depot's store in suburban St. Louis Park.

By Lou Gelfand, Star Tribune

Last update: June 11, 2006 - 5:03 PM

Eight days hence, the Minnesota chapter of the Public Relations Society of America (PRSA) will conduct an ethics seminar within walking distance of Home Depot's store in suburban St. Louis Park.

It'll be a rare moment of karma, for in recent days Home Depot staged a farce of an annual stockholders meeting with only one board member present -- Chief Executive Robert Nardelli. He was accompanied on the stage by two unidentified people and two large digital timers.

The New York Times account noted that Nardelli invited comments from shareholders with the caveat, "Questions are limited to one minute and one person." As the first person rose, the timer started counting down. The timer hit zero as he spoke and the microphone was shut off.

The Times account described "two big, burly men," wearing Home Depot aprons, "who look as if they could be bouncers at a rowdy club." They took a step toward the man. The man sat down.

Another shareholder went "through the litany of Nardelli's compensation abuses" since 2000 (more than $100 million in salary, bonuses and stock awards plus millions of dollars more in stock options) and urged adoption of a proposal that shareholders be allowed an advisory role on executive pay.

Afterward, the article said, "Nardelli replies matter-of-factly, 'The board recommends you reject this proposal.' "

In an appropriate finale to the questions, a shareholder said that the way Nardelli had conducted meeting was "really disturbing" and that "it really reflects what we have been reading in the press about the style of this board."

At this, the Times reported, "the room bursts into applause."

A day after the meeting, the Times published a letter from Brad Shaw, Home Depot's senior vice president for corporate communications and external affairs. It responded to an earlier Times article critical of Home Depot's executive compensation and defended Nardelli's pay, based on earnings growth and shareholder gains from dividends and share repurchases.

After the stockholder meeting, Nardelli had Shaw release a statement announcing a change in direction. It said, "Consistent with the way we run our company, in which we listen, learn and lead -- we will return to our traditional format for next year's annual meeting, which will include a business overview, the presentation of proposals, an opportunity for shareholder questions and with the board of directors in attendance."

After the about-face, I became curious about the integrity of Home Depot's PR.

PRSA's ethical code calls for PR practitioners to defend "values that inspire ethical behavior and performance."

That may conflict with corporate goals. If that happens, the wise and ethical public relations professional had better have a polished résumé and be willing to use it.

Lou Gelfand • louisgelf@aol.com

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